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Taoping Agrees to Buy Control of Chairman-owned Company

Shenzhen Taoping, which provides out-of-home digital advertising, is controlled by Jianhuai Lin, the chairman and chief executive officer of Taoping.

Peter H. Frank
    Jan 08, 2019 3:45 PM  PT
Taoping Agrees to Buy Control of Chairman-owned Company

Taoping Inc. (Nasdaq: TAOP), a provider of ad distribution systems and an online retail platform, said today that it agreed to buy 51 percent of Shenzhen Taoping New Media Co. Ltd. for an undetermined amount. 

Shenzhen Taoping, which provides out-of-home digital advertising, is controlled by Jianhuai Lin, the chairman and chief executive officer of Taoping. 

"Signing this LOI is another key strategic step for TAOP, as the proposed acquisition will enable us to enter into a $25.5 billion out-of-home advertising market in China with end-to-end digital marketing solutions," Lin said. "We strongly believe this transaction would bring tremendous value for our shareholders who have invested in and supported our mission of making advertising and branding affordable and effective for everyone." 

The Shenzhen-based company said the letter of intent called for the purchase price to consist of a combination of cash and ordinary shares in Taoping at a value to be established through a third-party appraisal. The letter of intent is set to expire in six months if no final agreement is reached. 

Taoping, which changed its name in May from China Information Technology Inc., provides digital advertising services to distribute and manage its client ads on display terminals. The company has developed a shared platform with Shenzhen Taoping that includes 100 members in China and overseas, Taoping said. The company announced in November that it signed an agreement with Canada-based Capital Green Tech & Trade Corp. 

For the nine months ended Sept. 30, Taoping said it had revenue of $16.5 million, an increase of 35 percent from the year before. Net income attributable to the company was $1.9 million for the same period, or 4 cents per fully diluted share. 

Taoping closed at $1.28 per share today in New York, up 1 cent.

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